Deals tie Rangers, Stars buyers to joint media venture

The future buyers of the
Dallas Stars and Texas Rangers are obligated to pursue a joint media venture
after the expiration of their current TV deals, according to terms of the Texas
Rangers sale agreement that was made public recently as part of the club’s
bankruptcy proceedings.

Both teams are owned by
Hicks Sports Group, but HSG is selling the clubs in separate transactions. The
teams have TV deals with Fox Sports Southwest that expire in 2014.

The commitment could tie
the hands of each team’s buyer, experts say, and close off other media opportunities.

“It could become very
complicated in terms of length of a deal, rights fees per game and how to treat
sponsors,” said Mark Lazarus, the former Turner Sports executive who now is
president of media and marketing services for Career Sports & Entertainment.
“I wouldn’t want any restrictions on things I could do, to be burdened with
another franchise’s issues.”

Under terms of the
agreement that has Chuck Greenberg purchasing the Rangers, the buyer after
closing shall “use commercially reasonable efforts to obtain a letter from the
National Hockey League confirming that the agreement for the potential joint
venture between Purchasers and the Dallas Stars regarding the media rights of
the Texas Rangers and of the Dallas Stars hockey club … is in compliance with
applicable rules and regulations of the National Hockey League,” the sales
agreement states.

The agreement describes a
similar requirement for the Stars’ sought-after buyer.

A “joint venture” could
mean the joint selling of cable rights; it also could mean the formation of a
regional sports channel. A source said that if a channel were to occur, the
equity split under consideration is 70 percent for the Rangers and 30 percent
for the Stars.

The commitment to go into
business together may be more valuable for the Stars than the Rangers, Lazarus
said. “It is a drag-along tactic,” he said. “Without it, the hockey team is out
there to fend for itself.”

It’s uncertain if the
media joint venture language would become part of any new agreement if the Rangers’
sales process were to be reopened and a new buyer emerges.